You may be searching online for financial information and may be wondering what exactly are installment loans and how can they help you? To begin with, it is a type of loan that gives you the opportunity to borrow a set amount of money by taking out this kind of loan. Now where as credit cards and lines of credit give you a revolving form of credit, installment loans do not offer you this opportunity. Instead, you must know ahead of time and have a clear number in mind, when it comes to borrowing the funds. There are many advantages to using this form of borrowing money and will continue to explain. Once you have borrowed the finances, you will then have to repay the installment loan over a number of months over a fixed amount of time. You and the lender will first agree to when and how much money will be paid to pay off the loan completely. Most payment plans are a monthly basis but schedules can be customized to your personal needs if necessary. Each payment that you make on the debt is known as an installment, this is why this type of loan is known as installment loans.
There are many different types of installment loans that people use. Some of these include very common things which include auto loans, personal loans, student loans and even mortgages. All of these types of financial loans are in fact installment loans as well. The different types will be covered below.
These types of loans are typically repaid on a monthly basis that can last from 12 to 96 months in length. It is common for loans with longer terms will have smaller monthly payments, yet they will have higher interest rates. This means that a person would end up paying more money for a car with a longer period loan rather then a shorter loan such as 36 months.
A mortgage on a home is a type of installment loan that is used to borrow the necessary funds to purchase a house. Mortgages typically are repaid over a 15 to 30 year period with monthly scheduled payments. Many mortgages are known to come with fixed rates which means the standard monthly payments and interest never change which is a positive thing.
These kinds of loans are an installment loan that are used for purposes which include consolidating debt, paying off sudden expenses and other debts. These personal loans usually have a term of between 12 to 96 months. These forms of credit usually have higher interest rates than other types of loans.
Positives of installment loans
Many people appreciate that installment loans for bad credit with guaranteed approval have predictable payments that are on a schedule. When you take out a fixed interest rate form of loan, your payments will be the same every month until the loan is completely repaid. This can only change if there are add-ons to the loan or things like insurance added to the loan. Having a known amount that must be paid on a schedule makes repayment much easier. It also helps lower the chances of missing payments because of unexpected changes to how much money you owe. When you are looking for an installment loan be sure to agree to monthly payments you can afford so you don’t have any issues with paying off the loan.
Negatives of installment loans
These types of loans can also have problems associated with them. When you take out a loan you will not be able to add to the over all amount you need to borrow unlike a line of credit or credit cards. You would have to take out another installment loan if you needed more money. When you are shopping for an installment loan choose one that covers the total amount of your expenses. Another issue with many loan companies is that they can have high interest rates based on your credit rating. If you have bad credit or no credit at all, you might have to pay higher fees for a loan. A larger monthly payment will make the cost of borrowing more expensive. Luckily at our company, we do not use credit checking bureaus or networks. This means your credit score will not effect your opportunity to gain a loan.
If you need an installment loan, we encourage you to fill out our secure and encrypted application form to begin the process of becoming approved. We can help you in your time of need and help you with a loan as soon as today or one banking day from now.